Credit Suisse to Move More IT Jobs to Poland and India

ZURICH -- Credit Suisse will cut
an extra 1 billion Swiss francs ($1.1 billion) of costs,
including axing more jobs, after its third-quarter net profit
more than halved due to losses on the value of its own debt.

Volatile financial markets, a dearth of deals and tighter
capital rules in the wake of the 2007-9 financial crisis are
forcing investment banks across the world to slash costs, and
the euro zone debt crisis has pushed many to cut back even more.

Profits from Credit Suisse's investment bank rose, helped by
a pick up in bond trading that has already been noted by U.S.
investment banks and is expected to boost European peers as they
report quarterly results over the coming days.

However, that was offset by weakness in Credit Suisse's
private banking business, which caters for wealthy clients.

Credit Suisse said on Thursday it was targeting 4 billion
francs in cost savings by 2015, up from a goal of 3 billion
francs it set in July and an earlier figure of 2 billion.

The bank, which is already cutting 3,500 staff or 7 percent
of its workforce, said job losses would be inevitable to achieve
the extra savings, but did not say how many more staff would go.

It has already combined the separate operating platforms of
its two main units - private banking and investment banking -
and will increasingly shift information technology jobs to
Poland and India as part of its cost saving drive, finance chief
David Mathers told journalists.

Crosstown rival UBS, which reports quarterly
results on Tuesday, is also expected to announce job cuts to
protect profits as it withdraws from riskier investment banking
areas which soak up large sums of capital.

Zurich-based Credit Suisse said net profit fell 63 percent
to 254 million francs, missing analysts' average forecast of
370 million. The quarter was hit by 1.05 billion francs in
charges, mainly linked to its own debt.

Banks can record gains if the value of their debt falls,
since it becomes theoretically cheaper to repurchase it, but
book losses if the value of the debt rises.

INVESTMENT BANKING BETTER

Credit Suisse's investment bank lifted revenue 66 percent on
the year while costs edged 5 percent higher in a large part due
to provisions for mortgage lawsuits. The unit benefited from a
surge in sales and trading of fixed-income products such as
credit and securitised products.

Credit Suisse's Mathers said business trends in the first
weeks of the fourth quarter were similar to the third.

At 0715 GMT, the bank's shares were up 2.2 percent at 2.79
francs, o utpacing a 0.5 percent rise in the Stoxx 600 European
bank index.

Credit Suisse's private bank didn't fare as well as the
investment bank, however. The unit's revenue fell on the quarter
and on the year, partly due to the traditional lull in client
activity during the summer holiday months.

"The only positive surprise is investment banking, where
Credit Suisse achieved strong revenues in fixed income and
advisory, in line with what we have seen at the U.S. banks,"
Kepler Capital Markets analyst Dirk Becker said.

"But in wealth management the malaise continues," he said.

Credit Suisse said it could not provide a timeline on
efforts to settle a U.S. tax investigation, although it did not
see any direct impact on its ability to generate asset inflows.

The Swiss government is negotiating with the U.S. government
to try to get investigations against 11 banks dropped in return
for expected hefty fines and the transfer of names of clients
suspected of evading taxes.

Credit Suisse is selling prime Swiss real estate, issuing
convertible bonds and slashing spending among a raft of measures
announced in July aimed at raising capital by 15.6 billion
francs after urgings by the Swiss central bank.

The bank said it is looking to sell its exchange-traded
funds business as part of the restructuring, confirming a recent
Reuters report, but said it did not plan further divestments
within asset management.

It also reiterated a return-on-equity target of more than 15
percent "over the cycle". Credit Suisse's ROE stood at 2.9
percent in the third quarter.